We've frequently found that our activities trend and once we have started a major review for one client, we soon have 3 or 4 others needing the same.  This time it is Executive pay reviews.

Every one of the clients looking for this support has a different reason for doing so.  Reviewing Executive pay is a crucial aspect of maintaining fair and competitive reward practices. Conducting an annual review is standard practice for all other staff – why should your Execs be treated any differently? It is an ideal opportunity to track and celebrate progress and discuss any performance issues and concerns (although I would still argue performance is a year round issue, not annual). It can also help focus individual efforts on corporate goals.

However, there are some key times when Executive pay should be reviewed outside of the annual process:

1.  When Setting New Strategic Goals: If you set new strategic goals or shifts your focus, reviewing executive pay can help align salaries and engage Execs with these new priorities.

2.   Following Major Organisation Changes: Events like mergers, acquisitions, or significant restructuring will generally impact the roles and responsibilities of your Execs. Reviewing pay during these times ensures that salaries reflect the new scope of work and help you identify any potential flight risks.

3.   When Market Conditions Change: If there are significant changes in the market, such as economic downturns or industry shifts, then you should consider a review of Executive pay to ensure it remains competitive and appropriate.

4.   In Response to Stakeholder Feedback: Feedback from shareholders, employees, or other stakeholders can prompt a review of Executive pay to address concerns and maintain trust.

5.    Periodically for Pay Equity Audits: Regular pay equity audits help ensure that Executive reward package is fair and free from biases related to gender, race, or other factors.

By regularly reviewing executive pay at these key times, you can ensure that you reward practices remain fair, competitive, and aligned with your strategic objectives.

Of course, salary isn't the only element in the reward package for Execs and my next blog will look at the key elements in a little more detail.